-
A9011115
Academy on Social Dialogue and Industrial Relations
Professor Gerhard Bosch, Institute for Work, Skills and
Training, University of Duisburg-Essen, Germany
([email protected])
”Outcomes of Collective Bargaining”
Turin, Italy • 26 November 2018 – 07 December 2018
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www.itcilo.org 2
High differences in coverage by collective agreements (CA’s) in
the world
Coverage depends on the level of agreements: is higher with
multi-employer collective bargaining and lower with firm- or plant
level bargaining, in between in mixed systems and zero where unions
are forbidden
Coverage is high and stable in countries:• With high trade union
density (Sweden, Denmark)• With high employer density (mandatory
membership in chamber of
commerce (Austria)• With regular extension of agreements
(France, Belgium and Greece in
the past) • With wage councils with arbitration (Uruquay)
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www.itcilo.org 3
High coverage by CA’s through multi-employer bargaining
Source: Hayter/Visser 2018 Collective Agreements: Extending
Labour Protection, ILO Geneva
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Low coverage by CA’s through single-employer bargaining
Source: Hayter/Visser 2018 Collective Agreements: Extending
Labour Protection, ILO Geneva
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www.itcilo.org 5
Dynamics of the predominant level of collective bargaining
(CB)
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www.itcilo.org 6
Controversial debate on the outcome of collective agreements
among economists (I)
Neo-liberal view – focus only on labour costs• a barrier to
micro and macro-flexibility• no other economic functions (like
regulation of training, working time
time, internal flexibility, co-determination ….)• no societal
effects like balancing power relations in society, giving
workers a voice in politics Dominant view of IMF, World Bank, EU
Commission after 2009, World
Economic Forum …….
Main recommendations: abolition of centralized or industry wide
CB, ofextension of agreements, of favorability principle, of
after-effects as in Portugal, Spain, Roumania, Greece after 2009 or
on Chile after 1973
Outcome is an empirical question
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World Economic Forum does not like industry wide CB in Germany
and Sweden (ranking of 138 countries)
Source: World Economic Forum, The Global Competitiveness Report
2016–2017, own presentation
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Controversial debate on the outcome of collective agreements
among economists (II)
Institutionalist view on centralized or industry-wide CB• Most
important instrument to reduce inequality of market incomes
up to the middle income classes• Important built-in-stabilizer
in economic crisis (avoids breaking down
of domestic demand)• Source of internal flexibility – beneficial
substitute for unhealthy high
levels of hiring and firing• Reduction of bureaucracy and
transaction costs – self-regulation
instead of state intervention• Levelled playing field for
companies - Fair competition increases
incentives to invest in skills• Positive wider societal effects:
Trust and democracy
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CA’s reduce inequality: Rate of coverage by CA’s and share of
low-wage work in the EU (2014)
Source: Visser 2015, Eurostat, own calculations
Diagramm1
22.48
11.94
15.08
14.76
2.64
5.28
8.81
3.79
24.4
21.26
17.75
22.76
23.56
8.61
23.96
25.46
18.52
19.21
12.03
9.44
18.69
21.56
18.47
14.59
18.19
19.33
adjcov: Adjusted bargaining (or union) coverage rate
share of low wage earners in %
Coverage by collective agreements in %
Correlation: - 0,82
DE
LU
MT
AT
SE
FI
FR
BE
RO
UK
HU
EE
PL
DK
LT
LV
NL
SK
PT
IT
CZ
IE
SI
ES
BG
CY
57.6
59
62.79
98
89
93
98
96
35
11.92
23
23
14.67
84
9.89
15
84.84
24.9
67
80
47.29
40.49
65
77.58
29
45.19
Data
Niedriglohnempfänger als Prozentsatz der gesamten Angestellten
(ohne Auszubildenden) nach Geschlecht [earn_ses_pub1s]
Letzte Aktualisierung07.12.16
Exportierte Daten19.02.17
Quelle der DatenEurostat
UNITProzent
SEXInsgesamt
SIZECLAS10 Arbeitnehmer und mehr
GEO/TIME200620102014Niedriglohnempfänger als Prozentsatz der
gesamten Angestellten (ohne Auszubildenden) nach Geschlechtadjcov:
Adjusted bargaining (or union) coverage rateKorr
Europäische Union (28 Länder):16.9617.15DE22.4857.6-0.82
Europäische Union (27 Länder)16.6916.9317.15LU11.9459
Euroraum (19 Länder)::15.88MT15.0862.79
Euroraum (17 Länder)14.2714.7815.7AT14.7698
Belgien6,82+B34B16:B406.373.79SE2.6489
Bulgarien18.922.0118.19FI5.2893
Tschechische Republik17.0518.1918.69FR8.8198
Dänemark8.318.178.61BE3.7996
Deutschland (bis 1990 früheres Gebiet der
BRD)20.322.2422.48RO24.435
Estland23.1923.7622.76UK21.2611.92
Irland21.4120.6621.56HU17.7523
Griechenland15.7312.82:EE22.7623
Spanien13.3714.6614.59PL23.5614.67
Frankreich7.136.088.81DK8.6184
Kroatien:21.35:LT23.969.89
Italien10.2712.369.44LV25.4615
Zypern22.6522.6219.33NL18.5284.84
Lettland30.927.8125.46SK19.2124.9
Litauen29.1227.2423.96PT12.0367
Luxemburg13.1813.0611.94IT9.4480
Ungarn21.8719.5117.75CZ18.6947.29
Malta14.4317.6115.08IE21.5640.49
Niederlande17.7417.4618.52SI18.4765
Österreich14.1915.0214.76ES14.5977.58
Polen24.7224.1623.56BG18.1929
Portugal20.7216.0812.03CY19.3345.19
Rumänien26.8525.8224.4
Slowenien19.2417.1418.47
Slowakei18.319.0319.21
Finnland4.755.855.28
Schweden1.772.512.64
Vereinigtes Königreich21.7722.0621.26
Island11.248.997.54
Norwegen6.487.278.29
Schweiz:11.039.37
Montenegro::27.25
Die ehemalige jugoslawische Republik Mazedonien:28.2525.13
Serbien::22.91
Türkei0.240.40.46
Sonderzeichen:
:nicht verfügbar
Data
adjcov: Adjusted bargaining (or union) coverage rate
Share of low wage earners
Coverage by collective agreements
Korrelation: - 0,82
DE
LU
MT
AT
SE
FI
FR
BE
RO
UK
HU
EE
PL
DK
LT
LV
NL
SK
PT
IT
CZ
IE
SI
ES
BG
CY
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www.itcilo.org 10
CA’s create middle income groups through differentiated wage
grids and effective minimum wages by industry
:
Source: Bosch, G (2017) “Intersection between minimum wages and
collective bargaining to increase pay equity”
MW
EMPL
OYE
ES (%
)
WAGE WAGEMW | CA
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Wages curves in Chile (no or decentralized CA’s) and Germany
(industry-wide CA’s)
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Breakdown of internal demand after the abolition of
industry-wide CB as built-in-stabilizer in Greece: Collapse of
internal demand
-10
-8
-6
-4
-2
0
2
4
6
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
2019
Spring 2008
Fall 2008
Spring 2009
Fall 2009
Spring 2010
Fall 2010
Spring 2011
Fall 2011
Spring 2012
Fall 2012
Spring 2013
Fall 2013
Spring 2014
Fall 2014
Spring 2015
Fall 2015
Spring 2016
Fall 2016
Spring 2017
Spring 2008Fall 2008
Spring 2009Fall 2009
Spring 2010
Spring 2011
Spring 2012
Fall 2012
Spring
Spring 2014
Fall 2014Spring 2015
Fall 2015
Fall 2016
Spring 2017 Fall 2017
Source: EU Commission, own compilation
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Main results of most recent empirical studies on CA’s (I)
Reduction of inequality: “… the erosion of labour market
institutions
in the advanced economies is associated with an increase of
income inequality” (Jaumotte/ Buitron 2015: 27, World Bank).
Positive effects on employment: “Co-ordinated systems are linked
with higher employment and lower unemployment, also for young
people, women and low-skilled workers than fully
decentralisedsystems" (OECD 2018)
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Main results of most recent empirical studies on CA’s (II)
The articulation between different levels of CB of the whole
system is more important than a single institution for
sustainability, flexibility and performance: uncontrolled
decentralisation has negative effects – articulation between
company and industry-wide CB positive effects (OECD 2018)
Extension of scope and time horizon through co-ordinatedCB:
negotiations on internal flexibility (skills, working-time)
“In some countries, trade unions and employer organisations
engage in sector-level initiatives that aim to enhance labour
market adaptability by facilitating job transitions and providing
workers with the skills needed in a changing world of work” (OECD
2018)
Negotiations on internal flexibility not automatic outcome of
co-ordinated CB – depends on actors, on workplace participation and
an innovation friendly environment
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Best practice of CB: Innovative agreements (I)
Norway: Industry Agreement 2016-18 y – Chapter on Competence:
Annual discussion with shop stewards on competence gaps in relation
to needs, creation of opportunities for unskilled to get a trade
certificate, updating the qualification of skilled workers.
Outcome: High productivity and employment rates of older and
unskilled workers
Germany: Many CA’s on the recruitment of apprentices on
national, regional and company level.
Outcome: lowest youth employment rate in the EU, recruitment of
540 000 apprentices even in the great recession 2009
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Best practice of CB: Innovative agreements (II)
Germany: Many CA’s on working flexibility: • adaption of hours
to business cycle (compromises between
employers and employees interests) • temporary reduction of
working hours in an economic crisis to avoid
dismissals (“Dismissing hours not employees”)• improving health
and safety (new more ergonomic shift systems) • Increasing
calculability of hours (minimum duration of notice for
variations of working hours)• Increasing working time options of
employees: Recent CA’s of
German Railways and in metal industry give employees options
between money and 8 free days: more than 50% voted for free days /
even 80% of shift workers
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Percentage of fall in total labour input due to fall in working
hours per employee, Germany, 2008–2009
0
10
20
30
40
50
60
70
80
90
100
Source: EUROSTAT .
Diagramm1
US
EU27
DE
AT
BE
NL
SE
IT
FI
DK
FR
UK
PL
EL
BG
ES
IE
RO
PT
CY
MT
CZ
EE
HU
LV
LT
SK
SL
East
30
33
97
49
38
38
37
35
33
32
31
30
24
18
10
8
8
6
4
0
0
0
0
0
0
0
0
0
Sheet1
USEU27DEATBENLSEITFIDKFRUKPLELBGESIEROPTCYMTCZEEHULVLTSKSL
East3033974938383735333231302418108864000000000
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Political Impact: Decreasing participation in elections low wage
earners in Germany
Source: Bundesregierung, Armuts- und Reichtumsbericht 2017.
IncomeClassSkills
low middle high
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Conclusions
Recommendations to deregulate co-ordinated CB not based on
facts
Research shows positive outcome of co-ordinated CB on
employment
CA‘s powerful instrument to reduce inequality of market incomes:
No need to choose between employment and equality
CA‘s help developing internal flexibility – many innovative
agreements
Important: articulation between levels
Creative actors needed: learning from good examples
Foliennummer 1High differences in coverage by collective
agreements (CA’s) in the worldHigh coverage by CA’s through
multi-employer bargainingLow coverage by CA’s through
single-employer bargainingDynamics of the predominant level of
collective bargaining (CB)Controversial debate on the outcome of
collective agreements among economists (I)World Economic Forum does
not like industry wide CB in Germany and Sweden (ranking of 138
countries)Controversial debate on the outcome of collective
agreements among economists (II)CA’s reduce inequality: Rate of
coverage by CA’s and share of low-wage work in the EU (2014)CA’s
create middle income groups through differentiated wage grids and
effective minimum wages by industryWages curves in Chile (no or
decentralized CA’s) and Germany (industry-wide CA’s)Breakdown of
internal demand after the abolition of industry-wide CB as
built-in-stabilizer in Greece: Collapse of internal demandMain
results of most recent empirical studies on CA’s (I)Main results of
most recent empirical studies on CA’s (II)Best practice of CB:
Innovative agreements (I)Best practice of CB: Innovative agreements
(II)Percentage of fall in total labour input due to fall in working
hours per employee, Germany, 2008–2009 �Political Impact:
Decreasing participation in elections low wage earners in
GermanyConclusions